Public Provident Fund that is also referred to as Provident Fund is one of the better instruments when it comes to collecting substantial corpus over a long period. The stability of investment, tax benefits, and sufficient returns that it provides at maturity are the few reasons that have made it a popular choice among investors.
You can invest up to Rs. 1.5 lakhs in PPF every year and it comes with a tenor of 15 years. To invest in PPF, you must first start a PPF account by visiting a bank or post office. Many banks allow you to start a PPF account online as well. For more details, you can go through an investment guide that can provide enough information on PPF.
For making the payment, you can use online payment options like net banking or phone banking. You may do so by adding the PF details like your PPF account number in your net banking account as a beneficiary.
The benefit of investing online is that you will not have to step outside your house for investment purposes. Also, by setting standing instructions, you can make this process automated which will save both your time and effort.
Automatic contribution facilitated by online payment will also inculcate a habit of disciplined savings as you will not have to remember about investing in PPF every time. If you want to park your savings in an investment option that also offers the flexibility of choosing a short or long tenor as per your requirements, you can also invest in fixed deposits.
Bajaj Finance FD is a fixed deposit scheme that offers a better interest rate than PPF and also comes with convenient investment options and a flexible tenor. Your deposits will be growing at a good pace with interest rates of up to 6.75% being offered by this FD scheme. The other benefits that are associated with Bajaj Finance FD are explained further below:
Online investment procedure
Unlike PPF, a complete online procedure from start to finish is offered by Bajaj Finance FD. The investment process can be started by filling an online FD form and you can share your CKYC number instead of going through the offline verification process. Also, the payment can be made through UPI, net banking, or debit card (in certain locations only) as per your convenience.
You will also be eligible for a 0.10% higher FD interest rate on choosing the online investment option.
Procuring loan against FDs
In times of financial crisis, you can procure a loan against FDs instead of withdrawing your deposits. Bajaj Finance FD gives you the opportunity of applying for a collateral-free loan of up to 75% against your fixed deposits.
Though you can opt for a loan against PPF as well, it can be done only after the completion of 3 years from the PPF account opening date. Therefore, the loan facility offered by Bajaj Finance FD is much more convenient and simple.
Flexible & more profitable investment option
PPF allows you to invest only up to Rs. 1.5 lakhs every year whereas there is no such limit on Bajaj Finance FD. You can deposit anywhere between Rs. 25,000 to Rs. 5 crores for each deposit.
Moreover, you can also invest in multiple fixed deposit plans at once. For this, you can utilize its multi-deposit provision that lets you invest in FDs of varying types and tenors. This provision encourages laddering that is ideal for negating the effect of changing FD rates on your FD earnings.
Also, you can lock in your deposits at anywhere between 12 and 60 months and reinvest in the same FD automatically after maturity by using the auto-renewal option.
PPF is offering an interest rate of 6.4% currently whereas Bajaj Finance FD lets your investment grow at interest rates of up to 6.75%. As a result, the returns obtained from it will be much higher. This makes Bajaj Finance FD much more flexible, profitable, and convenient option than PPF.
Safety of returns
Investing in Bajaj Finance FD is as safe as investing in a provident fund if not more. This can be checked from the high credit ratings viz. FAAA/stable from CRISIL and MAAA/stable from ICRA that it has received for being a secure investment avenue.